Nearly three years ago GLS undertook an informal listening project to hear what was on the minds of labor leaders, labor rights advocates, and NGO staff from around the world as they grappled with the challenges of globalization.
It is clear that globalization has produced a host of challenges for worker and social movements. But when we asked those we interviewed what specific issues they faced were most perplexing, at or near the top of nearly everyone’s list was what to do about China.
No wonder. China has become a focal point for much of the questioning and insecurity that globalization has produced. For the past two decades China has experienced explosive economic growth that has attracted jobs and capital from around the world. Today 25% of the global workforce is Chinese. No other industrializing country has ever attracted jobs at both the high and low ends of the production chain. From basic level assembly work to the upper tiers of industry and services, China is setting the global norm for working standards around the world. Workers in rich countries and poor countries alike, in almost every nook and cranny of the global economy, feel the effect of China.
Crucial to addressing China’s global impact is the often ignored fact that the driving forces in China’s labor market are the global corporations that move to China to lower labor costs and use the threat of this mobility as a lever to drive down wages and working conditions for workers in other countries, and even within China itself. China has welcomed foreign firms with open arms. A partnership has developed based on a quid pro quo: the Chinese government provides a compliant low wage labor force in exchange for massive foreign investment.
Over the past 3 years, GLS has produced scores of articles and two major reports on labor law reform in China. We have paid particular attention to the critical role played by global corporations in China’s development. This report builds on that work. Why China Matters: Labor Rights in the Age of Globalization provides background information needed to understand the issues involved and why the outcome of this battle matters so much to people everywhere.
Download the pdf version of the report here. Read below for a summary of the report.
Why China Matters: Labor Rights in the Age of Globalization
This report examines the forces at work inside and outside of China pushing for and against labor rights reforms.
Part one provides a survey of China’s new global economic power and its impact on the global economy. A case study from Namibia shows how employers use China as leverage to suppress wages, working conditions, and labor rights in other countries.
Part two examines the development of the Chinese working class. We briefly look at the structure of the Chinese workforce in the period before the era of economic reform began in the 1980s. Then we look at how the largest migration in human history—the movement of 200 million people from China’s countryside to its cities—reshaped China’s working class and its labor markets. Finally, we look at the reasons migrants leave the countryside and the conditions they face in the cities.
Part three examines the role of foreign corporations in China. China has opened its arms to foreign firms and investors by providing a business friendly environment and a disciplined low wage labor force. As a result, foreign firms have been the main drivers of China’s growth. They have created a complex industrial structure with long supplier chains of dependent firms and a sweatshop industrial culture.
Part four looks at the ways that Chinese workers are pushing back against the low wages and harsh working conditions that they face. Chinese workers are not passive. Although most are new to the city and industrial culture, they are gradually developing strategies to improve their lives. We assess informal, institutional, legal, and grassroots worker responses to China’s harsh industrialization.
Part five looks at China’s new labor code, implemented on January 1, 2008, which extends additional rights to workers. We examine what the law does, then look at the on-going global battle surrounding its drafting, enactment, and implementation.
Part six describes how global corporations lobbied against the new labor code and the global debate which ensued. Foreign corporations and their lobbying organizations have long argued that they support worker rights and the rule of law, but in reality they opposed key provisions of China’s new reform labor code, touching off a global battle. We examine how foreign firms may be vulnerable to pressure from workers and their allies outside of China to get them to support worker rights and the rule of law.
Part seven examines how labor unions and social movements outside of China are rethinking old strategies and reaching out to allies inside and outside of China in an effort to promote labor rights. The fight over the labor code has prompted a paradigm shift in strategies toward China by labor and social movements. Previously, the main focus has been on pressuring the Chinese government to pass new laws and respect labor rights. Now, following corporate opposition to such reforms, the focus is on the behavior of foreign corporations in China. This shift has also led to new—and sometimes controversial—approaches to dealing with Chinese unions and other official institutions. We assess the new paradigm and its potential to promote labor rights.
Part eight looks at what lies ahead. Will the same dynamic that occurred in other advanced industrial countries of worker insurgence, legal reform, corporate resistance, worker organization to demand law enforcement, and, finally, the institutionalization of labor rights and the rule of law happen in China? How can non-Chinese activists support the fight for worker rights in China? What effect will events in China have on worker rights around the world?